There was a tragedy in UK. This tragedy is in and by itself not important. What is important is its role as an indicator of what’s wrong with governments in general. Let’s go to the story.

You may know (or perhaps not) that in UK they are the happy owners of one of the best socialized medicine system in the world: the National Health System (or NHS). Well… at least that’s what they say.

A few days back, Rowena Golton jumped from the top of a building and eventually died due to her injuries. She clearly had mental issues. Her family knew this. They took it to the Manchester Mental Health and Social Care Trust where she was dismissed as with “sleep deprivation”. Sent home. Next thing, she committed suicide. Her relatives demanded:

A review of Manchester Mental Health and Social Care Trust’s processes and procedures

A “fix” of such processes and procedures from the government

An increase in the mental health budget of 10% for mental health care over the next 5 years to address the “overstretched” mental health system

Rowena’s relatives made these demand after receiving information as to just how bad the budgetary situation for mental health is. There are waiting lists stretching up to 9 months for many treatments. The rest is tabloid history. Many UK newspapers and blogs got the news and run with it. If you are interested in the story, you can read is under the title “Mental health care cuts drove my daughter to suicide, claims vicar” in The Telegraph from UK.

THE SITUATION

UK is a classic “developed” country and as such it exhibits a high degree of social services not the least being the NHS. This service originated after WWII when UK was dead broke and its empire gone. Why was the NHS established under such ludicrous economic conditions? Because it was politically expedient. There was a political current expressing a feeling that “we” (UK citizens) “deserved” the NHS after all the sacrifices that we made to “win” WWII. As such, politicians grabbed this opportunity to ride into power. As a matter of fact, Churchill lost his last election primarily due to this issue (Churchill understood that economic conditions were exceedingly difficult as to get into a spending spree). And the rest is history. The NHS was born.

The NHS (as with any other bureaucratic boondoggle) grew and grew and grew and continues to grow. This was and continues to be possible because of the insatiable thirst of bureaucrats for higher paying jobs, the absolute needs of politicians to keep theirs and the almighty capacity of the government to tax, print and borrow. Through this unholy trinity the NHS was built doomed from the very beginning into budgetary shortages.

Let’s be clear, budgetary shortages in the NHS were built-in from the very beginning. They are not a symptom of current times or the effects of current economic conditions or temporary issues. They are the very basic conditions upon which the NHS was first built. That was then and this is now; 60+ years into the future but the very same economic conditions remain. The unholy trinity made sure of that.

THE ISSUE

The problem is that the perception of WWII survivors was they were glad to be alive and feeling they deserved better. They rejected economic reality. This vision was fuelled by politicians who acting in their own best interest painted a deceiving picture. According to them, the NHS was possible alongside with economic prosperity, happiness and a pot of gold at the end of the rainbow. Delivered now.

This delusion directly lead to the unholy trinity which diverted massive amounts of riches and wealth from productive activities into consumer spending. As such economic progress in UK was killed. Of course, the NHS was not the only program that killed economic progress, but it was one of the biggest. By demanding NHS now!, UK citizens acted as any other person would; this is, in a so-called time-preference. We prefer to have things now than later. This is nothing new and not the source of the issue. The source of the problem was the perennial enabler: politicians. Without politicians willing to tax, print and borrow the NHS would not have been possible. If the NHS would not have existed (and many other similar programs as well) all that wealth would have been invested productively and the UK would have grown enormously rich. Instead, they got stagnation. With stagnation comes people’s inability to care for their illnesses and hence an increased demand for socialized health services.

Yes, it’s a vicious circle. The more the governments tax, print and borrow, the poorer people become. All the goods and services provided by the governments through spending what they taxed, printed and borrowed is far less than what people would be able to purchase should their wealth had been allowed to increase and expand naturally. This new wealth would have negated the need for an NHS to begin with.

ONE MORE ISSUE

But there is more. By forcing a monopoly of health care over all UK citizens all other health care offers were automatically negated. There was and there is no health care competition nor profit. As such there is no incentive to lower costs. There is no incentive to be better, faster, nimbler, more effective and efficient. Citizens are stuck with a system designed by the equivalent of dinosaurs in pre-historic ages. And they are paying for it. Is then there surprising that the system does not work and it is broken? Of course not.

And then we have the issue of choice. Rowena did self-diagnose and was seeking help. In a competing health care system there would have been several offers that would have suited her. Sure, chances are, many of these offers would have been the wrong ones but at least she would have received some sort of help, which would have been far better than what she got from the NHS: nothing.

PRIVATE BEATS PUBLIC

Whenever we compare private systems competing against each other in a truly free market against forced public and monopolic ones, we find that the choices and benefits of the former grossly outweigh the latter. What does not make it seem so is the illusion of taxing, printing and borrowing. We must always remember that for as long as there is money, any system can be made to work, regardless as to how ludicrous it may be.

This is the case of all public health systems and indeed all public systems anywhere in the world. Are there exceptions to this rule? Probably, but if they do exist we don’t know of them. Let’s be clear and compare apples to apples. It’s not that we don’t know of good public services; we do. There is no question about it. The question is a different one: do we know of any good public services that finance themselves without taxing, printing or borrowing and still provide better services than private companies? No.

The reason is very simple; private companies must live strictly within their means while striving to lower the price and increase profits. Public systems do no. All it is required is to increase political pressure so that taxing, printing and borrowing increases. Always remember that public finances is simply your money spent by other people without your consent.

LET’S BLAME THE GOVERNMENT

Rowena’s relatives are correct in blaming the government. It is very much indeed government’s fault. It’s just that the reasons for the fault are themselves faulty. It is not a budget issue; it is an issue of purposely depressing economies through official theft. It is an issue of lack of economic freedom. It is an issue of political force executed in the pursuit of a better paying (political) job.

CONCLUSION

This small issue in UK is a classic example as to why governments do not work. They only seem to work until they all run out of money. And then we are bombarded with all kinds of excuses. Enough! Enough horse manure and enough taking us for a ride. When confronted with all these lies and confabulations just say NO!

But then again, it is your choice and yours alone.

Note: please see the Glossary if you are unfamiliar with certain words.